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INDIANA INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION
APRIL 2019
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MARKETING MATTERS
| By Kenny Atcheson
HOW TO EARN A STEADY FLOW OF BUSINESS
REPEAT
AND
REFERRAL
Many independent dealers are reliant upon tax season to make or break their year. Wouldn’t it be great to have the ability to generate an endless, steady flow of customers at a reliable and predictable pace rather than waiting for the annual tax season bump? That’s what an R&R System can do for your dealership. R&R is my abbreviation for Repeat and Referral business. One system earns both Rs because the same behaviors that earn one earn the other. The first step to having an incomegenerating R&R System is to make a decision to put forth effort, devote time, and invest money into a system. System is italicized here to stress its importance. Occasionally asking customers for a referral or to buy again is not a system. That is a random act of marketing. A Repeat and Referral System Provides Stability To illustrate the point, let’s look at things that aren’t so stable. A company reliant upon cold calls likely struggled big time when the Do Not Call list and other similar laws and regulations were enacted. The same thing happened with broadcast fax and later texting. Then there were changes in the marketplaces, such as DVRs and the way media may or may not be delivered. People don’t want to sit through commercials, so they record shows. Newspaper organizations struggle. Yellow Pages are moving from print to digital. An overnight algorithm change in Google can cause your company’s search engine rankings to plummet. Your business could go from ranking number one to disappearing off the first page of Google in the blink of an eye – by one algorithm change. xIt happens all the time. In 2016, Google AdWords Pay-Per-Click went from ranking 10 ads to four ads on the right side of the first page. If your business succeeded by ranking number five when there were 10 companies listed, your ad likely disappeared overnight when the list dropped to four. Then the world really shifted toward mobile. If your advertisements were geared for people who used desktop computers or laptops, you faced another challenge unless your website was already mobile-friendly. These are just a few laws, rules, and changes. If your company has a great referral system in place that is implemented regularly, referrals and repeat purchases will come at a steady and somewhat predictable pace. Think of repeat purchases as previous customers who refer themselves. Implement the same behaviors and systems to generate referral customers that you use to generate repeat customers.
SYSTEM
An R&R System is Under-the-Radar “I don’t know why that dealership is so successful while we struggle. We have similar inventory and I don’t think they advertise.” This is what the head of your competition will likely say when you have a powerful force of referral soldiers who battle every day to send business your way. I am a fan of under-the-radar strategies. It is hard for a competitor to copy a constant flow of referrals, because they have no idea why you are having so much success. Occupy Space in Your Customers’ Minds Your customers don’t spend nearly as much time thinking about your dealership as you would hope – no matter how great their experience was. While tailgating outside a football game, if your customer was asked by a friend if they knew of a great dealership, your customer would probably recommend your business. But if your customer overheard two people talking about needing a good dealership, would your customer go out of their way to politely interrupt the conversation and recommend you?
This would require your customer’s escalating motivation to refer your dealership. To occupy space in your customers’ brains at all times – including situations where they are motivated to refer business to your dealership – you must provide great experiences and communicate regularly. Sure, occasional big customer events are great. But continuous communication that offers fun, value, and prizes via print and email newsletters is a continuous method to occupy brain space – including the grey matter that reminds them about your businesses when a situation arises to refer your dealership. Referrals provide stability and consistency. Many behaviors and systems that are implemented to increase referrals also increase repeat purchases. Keep that in mind when you consider the effort or investment it takes to communicate consistently with your existing customers. Kenny Atcheson is the founder and president of Dealer Profit Pros and author of Marketing Battleground: How to Deploy Under-the-Radar Strategies to Explode Your Profits. Learn more at www.DealerProfitPros.com.
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2019
INSIDE
05..............................Quality Dealer Nominations 06..................................... IIADA Golf Tournament 08.........................................................CarLawyer 09.......................................Question of the Month 12....................................Successful Salespeople 14.......................... Sales Tax Regulation Changes
ADVERTISERS INDEX
BacklotCars..................................................... IBC Dyer Auto Auction............................................... 5 Greater Mishawaka AA........................................ 3 Kesler Schaefer AA............................................. 9 Manheim ............................................................. 11 NextGear Capital.......................................... 12-13 vAuto................................................... Back Cover Warrantech.......................................................IFC
BOARD MEMBERS
WHAT’S NEW
CONVENTION R E G I S T R AT I O N O N L I N E Registration for the 73rd annual NIADA | NABD Convention & Expo is now online! You don’t want to miss this industry-leading mega-conference! The event is June 17-20 at the Venetian in Las Vegas. Learn more and register today at www. niadaconvention.com.
OFFICE
For information on how to become a member of IIADA, please call 219.661.0287 128 S. East Street # 1393 Crown Point, IN 46308 iiada@comcast.net • www.iiada.com
NIADA HEADQUARTERS
NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838
For advertising information contact: Troy Graff (800) 682-3837 or troy@niada.com. Car Lines is published 10 times per year by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 76006-5203. Periodicals postage paid at Dallas, TX and at additional offices. POSTMASTER: Send address changes to NIADA State Publications, 2521 Brown Blvd., Arlington, TX 76006-5203. The statements and opinions expressed herein are those of the authors and do not necessarily represent the views of Car Lines or NIADA. Likewise, the appearance of advertisers, or their identification as members of NIADA, does not constitute an endorsement of the products or services featured. Copyright © 2019 by NIADA Services, Inc.
STATE MAGAZINE MGR./SALES Troy Graff • troy@niada.com EDITORS Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT Christy Haynes • christy@niada.com PRINTING Nieman Printing
Executive Director Debbie Andersen 128 S. East Street # 1393 Crown Point, IN 46308 219.661.0287 iiada@comcast.net
President
Andy Zay Zay Leasing & Rentals, Inc. 4957 N. Broadway Huntington, IN 46750 Phone: 260.356.1588 azay@sbcglobal.net
Chairman of the Board Legislative Chairman Fritz Kreutzinger Fritz Associates P.O. Box 168 Fishers, IN 46038 317.842.2228 Fax: 317.842.7900 fritzauto@aol.com
Vice President
David D. Baldwin II Best Deal Auto Sales, Inc. 1875 SR 8 Auburn, IN 46706 260.357.0099 Fax: 260.357.0090 dbthesecond@yahoo.com
Treasurer
Bruce Norton Drive1 USA, Inc. 1512 W. 96th Avenue Suite C Crown Point, IN 46307 Phone: 219.670.0542 Bnorton@drive1usa.com
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Secretary
Sharon Brennan Fritz in Fishers 8599 E. 116th Street Fishers, IN 46038 Phone: 317.842.2228 sharonb@fritzinfishers.com Tricia Trent Trent Auto Sales 1327 N 6th St. Vincennes, IN 47591 812.882.3772 Fax: 812.882.1986 ttrent01@yahoo.com David Lewis Lewis Motor Sales 1125 Sagamore Parkway S. Lafayette, IN 47905 765.448.4006 Jennifer Cotton Dyer Auto Auction 219.865.2361 Fax: 219.322.1761 bcotton@dyerauction.com Ed White White’s Auto Sales 1105 McKinley Ave. Rensselaer, IN 47978 219.866.7553 Fax: 219.866.7256 edwhite123@att.net
Tony Houk Kesler-Schaefer Auto Auction, Inc. 5333 W. 46th Street Indianapolis, IN 46253 317.297.2300 Fax: 317.297.6236 skesler@ksaa1.com Tyler Trent Trent Auto Sales 1327 N 6th St. Vincennes, IN 47591 812.882.3772 Fax: 812.882.1986 ttrent01@yahoo.com Travis Baldwin Best Deal Auto Sales 2526 Scotswolde Drive Fort Wayne, IN 46808 Phone: 260.483.7999 travisbaldwin@ bestdealautosalesonline.com Taryn Sanchez White’s Auto Sales LLC 1105 N. McKinley Avenue Rensselaer, IN 47978 Phone: 219.866.7553 twhite1517@att.net
Tony Del Real Del Real Automotive Group 1002 Walnut Avenue Frankfort, IN 46041 John Stumpf Phone: 765.446.9204 Greater Kalamazoo Auto Auction tdelreal@delrealauto.com P. O. Box 697 Schoolcraft, MI 49087 269.679.5021 jstumpf@kalamazooaa.com
| ASSOCIATION NEWS |
NOMINATE A DEALER FOR IIADA’S 2019 QUALITY DEALER OF THE YEAR Application Deadline: July 1, 2019
Applications are now being accepted for Indiana’s 2019 Quality Dealer of the Year. The winner will represent Indiana at the NIADA 2020 Convention & Expo and compete for the coveted NIADA Quality Dealer of the Year award. The public recognition and prestige associated with this award will produce many benefits for your dealership.
Eligibility: Dealers must be nominated by an IIADA member or sponsor. To request an application, email iiada@comcast.net or call 219.661.0287.
SAFETY WATCH
AUDI RECALLS SEDANS FOR ELECTRICAL ISSUES
AUXILIARY HEATER ELECTRICAL CONNECTOR Volkswagen Group of America Inc. is recalling 845 2015-16 Audi A6 Sedans and 2015 Audi A7 vehicles. The auxiliary heater electrical connector on these vehicles may have been incorrectly inserted into the auxiliary heater, possibly resulting in increased electrical resistance. Volkswagen will notify owners, and dealers will inspect the auxiliary heater connector, replacing the auxiliary heater and connector, as necessary, free of charge. Volkswagen’s number for this recall is 82C1. WWW.IIADA.COM APRIL 2019 CAR LINES 5
Save the date
August 25, 2019 Eagle Creek Golf Club Pete Dye Championship Golf Indianapolis, IN
IIADA ANNUAL GOLF TOURNAMENT AWARDS
DAY AND TRADE SHOW
Save the date
08 25 2019
For registration and sponsorships: iiada@comcast.net
219.661.0287
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ACCELERATE |
By GWC Warranty
IS YOUR REPUTATION IN GOOD HANDS?
CHOOSE YOUR SERVICE CONTRACT P ROV I D E R W I S E LY
Unfortunately in the used car business, your reputation after the sale can sometimes be out of your hands. Once that aspect of your business is out of your control, you need to be sure it’s protected in the hands of someone you trust. If you’ve been in the business long enough, you know that despite the best reconditioning and the best inventory selection, you’re bound to run into vehicles that encounter issues after the sale. When this happens, it’s your reputation on the line. How these fragile situations are handled can have long-lasting impacts on your reputation in your market. Partnering with a service contract provider that has the tools in place to take care of your customers the way you’d want them treated is perhaps the most important thing you could do to protect your reputation when your customer’s experience is out of your control. That’s why you need to know some specifics about what your service contract provider has to offer so you can be sure your customers are in good hands after they drive off your lot. Coverage Lookup A simple online coverage lookup tool is a great way for customers to learn details about their contract on a moment’s notice. Whether it’s start or end mileage, expiration dates, component coverage or a look at the contract itself, having this in place helps customers know exactly how they’re covered.
Find a Shop A customer’s nightmare is a mechanical breakdown far away from home. A nationwide network of service facilities is one thing but being able to easily find a shop in an unfamiliar area is another. This online application takes the worry out of an out-of-town breakdown. Quick Answers These days, consumers demand answers, and they demand them quickly and on their terms. Having a service contract provider that allows customers to submit questions via online forms, live chat or social media gives customers multiple options, so they can get answers in whatever way suits their busy schedules. Good Reviews Online reviews in today’s automotive industry are vital to success. The same goes for service contract providers. Stick to trusted sites like Google (sometimes hidden in the maps section), Facebook, or Consumer Affairs and look beyond just star ratings. While overall ratings are important on the surface, looking at how often a service contract responds and the frequency with which customers leave reviews will give you a sense of how that provider cares for your customers.
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LEGAL UPDATE |
By Thomas B. Hudson and Nicole Frush Munro
THE CARLAWYER
KEEPING YOU INFORMED WITH THE LATEST GOVERNMENTAL AND ACTIVITY IN THE USED CAR INDUSTRY
Here’s our monthly article on legal developments in the auto sales, finance and leasing world. This month, the action involves only the Consumer Financial Protection Bureau. As usual, this month’s article features our “Compliance Tip” and our “Case of the Month.” Note this column does not offer legal advice. Always check with your lawyer to learn how what we report might apply to you, or if you have questions. This Month’s CARLAWYER Compliance Tip Does your website meet the requirements of the Americans With Disabilities Act? If hearing that question made you spill your coffee – if you haven’t given that topic any thought – you should know a number of dealers around the country have been threatened with ADA litigation over the ability of disabled persons to use the dealers’ websites. Perhaps it’s lawyer time? F EDER A L D EVELO PM E N TS Bureau’s UDAP authority is alive and well: On January 3, the Consumer Financial Protection Bureau announced it reached a consent order with USAA Federal Savings Bank for allegedly (1) violating the Electronic Fund Transfer Act and Regulation E by failing to honor consumers’ requests to stop payment on preauthorized electronic fund transfers and by failing to initiate and complete adequate error resolution investigations when consumers contested incorrect or unauthorized electronic fund transfers, and (2) engaging in unfair acts and practices by reopening deposit accounts consumers had previously closed without seeking prior authorization or providing adequate notice. The consent order requires USAA to, among other things, provide approximately $12 million in restitution to affected consumers and pay a $3.5 million civil penalty.
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Looking for authority: On January 17, new CFPB director Kathy Kraninger announced she has asked Congress to grant the bureau clear authority to supervise for compliance with the Military Lending Act. The bureau sent its legislative proposal to Speaker Nancy Pelosi and Vice President Mike Pence (in his capacity as president of the U.S. Senate), with copies to the chairs and ranking members of the Senate Committee on Banking, Housing, and Urban Affairs and the House Committee on Financial Services. And another report: On January 24, the bureau’s Office of Servicemember Affairs released its annual report. The OSA monitors and analyzes complaints from servicemembers, veterans and military families about consumer financial products or services, credit reporting and debt collection, among other issues facing servicemembers in the financial marketplace. The report provides an analysis of those complaints and discusses perceived emerging issues and trends in the financial marketplace that affect servicemembers, educational initiatives and the OSA’s coordination with other federal and state agencies. Enforcing void loans? The bureau settled with several payday lenders and corporate officials based in Canada and Malta for allegedly violating the Consumer Financial Protection Act of 2010. The CFPB alleges they misrepresented to consumers that they were obligated to repay loans in states where the loans violated state licensing or usury laws and state law voided the loan. The loans were also illegally conditioned on irrevocable wage assignment clauses, which the CFPB alleges violates the Credit Practices Act. CAS E O F T H E M O N T H A consumer bought a new boat from a boat dealership. The purchase agreement signed by the consumer provided he was buying
ISSUES
the boat “as is,” with no warranties by the dealership. After numerous issues with the boat’s carbon monoxide alarm, generator and port engine as well as a fuel leak, the consumer sued the dealership for violating the Deceptive Trade Practices Act, breach of contract, negligence, and gross negligence. The dealership moved for summary judgment, arguing the consumer’s claims failed because he bought the boat “as is.” The trial court granted the dealership’s motion, and the Court of Appeals of Texas affirmed. The appellate court noted the “Texas Supreme Court has held that, generally, an ‘as is’ clause will defeat the element of causation in DTPA, fraud, and negligence claims.” In this case, the appellate court rejected the consumer’s argument that the “as is” provision was concealed. The appellate court found the provision was printed in bold and capitalized typeface on the back page of a 2-page agreement. Moreover, the consumer signed the first page of the agreement directly below language telling him to see the reverse side for important information regarding limitation of warranties. The appellate court added that the consumer’s failure to read the document was not a defense. Finally, the appellate court noted there was no evidence the dealership was aware of and attempted to conceal the boat’s defects. See Juda v. MarineMax, Inc., 2018 Tex. App. LEXIS 10640 (Tex. App. December 20, 2018). So, there’s this month’s roundup! Stay legal, and we’ll see you next month. Tom (thudson@hudco.com) is of counsel and Nikki (nmunro@hudco.com) is a partner in the law firm of Hudson Cook, LLP. Tom has written several books and is the publisher of Spot Delivery, a monthly legal newsletter for auto dealers. He is the CEO of CounselorLibrary.com, LLC and the editor in chief of CARLAW, a monthly report of legal developments for the auto finance and leasing industry. Nikki is a contributing author to the F&I Legal Desk Book and frequently writes for Spot Delivery. For information, visit www. counselorlibrary.com. © CounselorLibrary.com 2019, all rights reserved. Single publication rights only, to the Association. HC 4829-1089-6519.1.
ASSOCIATION NEWS
QUESTION OF THE MONTH
REMOTE SELLERS AND SALES TAX
Are you a “remote seller” subject to collection of other states’ sales tax? According to Streamlined Sales Tax regulations, a remote seller is generally a seller that sells products or services for delivery into a state in which that seller does not have a physical presence or other legal requirement to be registered other than because they exceed that state’s economic nexus threshold. Guidelines for remote sellers have been published at the following site: www.streamlinedsalestax.org/for-businesses/ remote-seller-faqs/remote-seller-state-guidance. Please note that this does not override Indiana sales tax regulations. Dealers selling vehicles online should consult with their CPA.
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SOCIAL MEDIA | By Kathi Kruse
WHY YOUR FACEBOOK PAGE IS FAILING
TIPS
TO
MAKE
YOUR
Not all Facebook pages are created equal. It’s hard to ignore the opportunities available with Facebook to attract, engage and convert car buyers, but building a high-converting Facebook page has been elusive for many. It’s important to know the elements of a successful Facebook page, and even more crucial to recognize the reasons your Facebook page may be failing. If you want your car buyers and their friends to notice, you have to continually reward them with great content and build an engaged community for them. This means employing a content strategy that works for your dealership both culturally and operationally. You also have to incorporate Facebook ads to promote your content and encourage clicks to your website from interested buyers. If consistent engagement and conversions on Facebook is a struggle for you, here’s a list of reasons your Facebook page may be failing, with tips to make it work for you rather than against you. YOU D O N ’ T P U B L I S H R E G UL AR LY Consistency is a cornerstone of Facebook (or any other) marketing. Users need to see your posts in their newsfeeds for you to stay relevant. It’s a battle right now for attention. Inconsistent posting (such as a few times per month) is not going to capture anyone’s attention. YOU R PA GE L A C KS T H E H UM AN TOU C H Fact: Facebook pages fail because posts focus on products instead of people. There’s often a complete disconnect from the human side. Content that demonstrates why people choose the business seems to be nonexistent on many dealership Facebook pages. If you approach Facebook with the sole mindset of selling, you will waste your precious time. Facebook is first and foremost a social network, not a billboard. YOU ’R E N OT U SI NG T H E 3-GEA R ED A P P ROAC H TO CONT EN T Content marketing (messages that meet your customer where they are in their purchase journey) is a powerful tool for driving qualified leads. The challenge lies in producing highquality, original content on a consistent basis. Content must reach each of three stages of the buying cycle: • Entertain. Most people who engage with your page are not immediately “in-market.” The inability to engage this large segment of users is where many pages fail. • Educate. Fans who are thinking about a purchase, or who have friends who are, appreciate answers to their questions. • Excite. Facebook posts and ads need to provide offers worth the prospect’s time. Exciting content compels people to click in
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anticipation. YOUR P OSTS LO O K A N D FE E L COUN T E R FE IT Every dealership has a “personality” – characteristics, features, traits, etc. – that makes it unique. People are more attracted to sellers who communicate exactly who they are and what impact they wish to have in their customers’ lives. Publishing benign content that can be found anywhere is the shortest distance to the bottom. This is often obvious when dealers hire outside providers to “do social media” for them. The provider’s “voice” can come through on Facebook and make it look like someone other than you is doing the work. This is not a good look for those who want to engage real people. YOU D O N ’ T FU L LY U N D E R STA N D YOUR TA R G E T AU D I E N C E Creating a content strategy without a clear understanding of your audience is like setting sail without navigational tools. You’re out there, you’re taking action, but you’re not sailing toward a specific goal. Pretty soon, huge amounts of time and money have been spent without any clear return on investment. Facebook’s deep data allows dealerships to laser-target ideal users. Building target audience profiles improves your Facebook marketing tenfold. •D etermining the “buyer personas” of your core audience improves the way you solve problems for your customers. •E stablishing customer pain points helps create content that’s useful to your prospects (and builds authority with search engines). •U seful, high-quality content increases engagement and builds your social presence. •W ebsite content (i.e. blog posts) published on Facebook and clicked-through to your site increases search ranking. YOU D O N ’ T R E G U L A R LY CON D U C T A FA C E B O O K PA G E AUD I T Whether your social media marketing is in-house or outsourced, it’s often difficult to know where the gaps are between your current successes and where you need to be. There are numerous ways you benefit from an audit or review of your social media. Given today’s accelerated rate of potential failure with Facebook marketing, a social media audit will help your page work harder and achieve goals faster. YOU’ R E IG N O R IN G CO M M E N TS AN D ME S SA G E S Facebook is a communication channel just like email and the phone. Customer service via social media is a game-changer but if you don’t have a process to monitor, listen and respond to messages, you’re dead in the water.
Nobody likes the feeling of being ignored. If you’re looking for a competitive advantage, consider designating a “community manager” to oversee your online channels. YO U H AV E N O D E FI N E D G OA L S High-converting Facebook pages have clear, well-defined marketing goals. At Kruse Control, we begin with an outline of three goals and then build out the specific strategies that help a client achieve them: • Attract. Likability and relevancy are huge in attracting new and existing customers to your Facebook page. Add value to their lives by delivering awesome content. • Engage. Many dealerships fall flat when determining what to do with their fans once they become connected. • Convert. Attracting the right audience and engaging them lays the groundwork. Drive conversions using ads that provide valuable information that helps them finalize their purchase decision. YO U ’ R E N OT L E V E R A G I N G T H E P OW E R O F FA C E B O O K A DS Facebook has become one of the most powerful platforms to generate sales leads. Dealership Facebook pages fail because they either aren’t using Facebook ads correctly or they’re not using Facebook ads at all. No Facebook page will be truly successful without Facebook ads. Why? It’s simple: you must pay Facebook to reach car buyers. YO U ’ R E N OT M E AS U R I N G A N D A N A LY Z I N G YO U R R E S U LTS You can’t manage what you don’t measure. Dealers who don’t review their Facebook results are doomed to repeat their mistakes over and over again. Facebook Insights (your page analytics tool) gives you all the metrics you need to judge how your page is doing. You can see which content got the most organic and paid interaction, what you did right, and what didn’t work so well. Facebook Ads Manager gives you up-to-theminute stats on how your ads are performing. Analyzing results lets you: • Deliver a better experience for fans and the public. • Make better decisions on your content. • Tweak as you go to improve ROI. • Determine if you’ve reached your goals. If you’re not getting the results you want, compare your page’s components to these 10 reasons and see where you can improve. If your page doesn’t size up and you need help to improve, feel free to contact me. Kathi Kruse is an automotive social media marketing expert, blogger, consultant, author, speaker and founder of Kruse Control Inc., which coaches, trains and delivers webinars focused on integrating social media and online reputation management into dealership operations. She can be reached at kathi@ krusecontrolinc.com.
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SALES MATTERS | By John Chapin
SUCCESSFUL SALESPEOPLE
THE
TWO
MOST
IMPORTANT
CHARACTER
TRAITS
We know there are many character traits that determine long-term sales success or failure. That said, I find there are two key traits that really separate the cream of the crop. T WO K E Y T R A I TS O F TO P P RO D U C E R S Extreme Ownership The most successful salespeople take complete ownership of everything in their life, and I do mean everything. From sales numbers all the way to car accidents, they see themselves as ultimately in control of, and responsible for, anything related to getting their job done and meeting obligations. They are empowered so when something goes wrong they can immediately grab the bull by the horns and do what they must to remedy the situation. They don’t spend time complaining, playing the victim or throwing their hands up in a “what’s the use, it’s out of my control” fashion. I’ve seen the best salespeople overcome weather, power outages, tornadoes, car accidents, trips to the hospital, and almost everything else you can imagine to make sales calls and hit their numbers. If you
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have a meeting scheduled with them and the world is coming to an end, you can bet they’ll be there. Top salespeople are committed to and completely accountable to their clients, their family, themselves, their company and coworkers, and everyone else they come into contact with. They are hard-working self-starters and have the willingness to push themselves harder than anyone else can possibly push them. You don’t need to look over their shoulder to make sure they’re doing what they should be doing. They understand they have an obligation to their clients, and to the company that pays them, to go above and beyond and put in maximum effort. Top producers are completely sold on their product to the point that if it’s something they can own, they do, along with their family and friends. They have conviction and are passionate about helping others while saving people from the competition who, at best, will not take as good care of them as they will and at worst will even take advantage of them. They have a willingness to go far above and beyond for prospects and clients and will do anything and everything to win fairly and ethically. Top producers understand that success is completely up to them. They take complete ownership – extreme ownership – reminding themselves they are 100 percent responsible for their success. If they fail, they own it. Everything begins and ends with them. They don’t blame anyone or anything outside of themselves.
You won’t hear them complaining about the competition being cheaper, the supposed bad market or the new industry regulations. They know that even in the toughest of conditions, someone is thriving, and they’re determined it’s going to be them. You also won’t hear them blaming outside forces for a lost sale, past failure, or anything else that has put them in their present position in life. Extreme Drive and Determination The best are extremely driven and determined. They know why they are doing what they are doing and they know who and what they are doing it for. They know superstars aren’t super-human – they are average, flawed individuals just like the rest of us. The difference is they’ve found a reason, a purpose within them, that gets them up early, keeps them up late and keeps the fire of motivation and determination burning brightly within them, and they use it to outwork everyone. The champions are like extreme athletes when it comes to dedication, commitment and preparation. They make do-or-die commitments. They do whatever it takes to make their dreams and vision a reality and are willing to fight for what they believe in. Top producers realize there is no such thing as get-rich-quick or overnight success. They know you must pay the price for success in advance, and they do. They are willing to suffer and put in lots of work and they don’t require immediate rewards or payoff. They are willing to work like no one else will for three, five or 10 years
or more to live the rest of their life like no one else can. Top salespeople understand that one of the biggest enemies of long-term success is the comfort zone, which can cause us to lose our fire. To defend against this, the great ones create a mission statement that is so magnificent they need to constantly be growing and expanding to fulfill it. They also surround themselves with people who continually challenge them and force them to grow. From time to time they assess their values and what’s really important to them because they understand that priorities change as we go through life. They continue to make larger, grander goals and plans so as they approach the achievement of one goal they have a bigger one to keep their motivation strong. Finally, the best understand that sheer will and determination will pretty much overcome any obstacle and take you anywhere you want to go in life. They apply that will and determination at a level few humans are willing to match. They decide on a goal and then cut off all avenues of escape. They burn the boats behind them. They make the decision to climb the mountain knowing they are either getting to the top or dying on the side of the mountain, but they are not coming down – they aren’t quitting. It’s all-or-nothing, do-or-die. John Chapin is a sales and motivational speaker and trainer. He has over 31 years of sales experience as a number one sales rep and is the author of the 2010 sales book of the year: Sales Encyclopedia. For more information, visit www.completeselling.com or email johnchapin@completeselling.com.
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S A L E S TA X R E G U L AT I O N CHANGES
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EFFECTIVE APRIL 2, 2019
The Indiana Department of Revenue has updated Information Bulletin 28S to reflect the taxation of document fees effective April 2, 2019. Although no law or Indiana Code Sections have been changed or updated, the Department of Revenue is making policy changes regarding documentation fees. According to Information Bulletin 28S – dated January 2019 and effective April 2, 2019 – fees for services performed after the transfer of a vehicle or trailer are not considered part of the sales price and, therefore, are not subject to sales tax. Transfer of a vehicle or trailer takes place upon physical delivery when the purchaser takes possession and control of the property, even though the title may not have yet been transferred. The dealer must maintain adequate records to show which services pertain to the fees charged and that the services were performed after the transfer of the vehicle or trailer to be exempted from sales tax. Fees charged for services performed prior to the customer taking physical possession of the vehicle or trailer are subject to sales tax. Historically, separately stated fees labeled as “documentation fees” were presumed to be at least partially excluded from gross retail income because all or part of the fee was considered to be compensation for preparing and submitting documents to the Indiana Bureau of Motor Vehicles on behalf of the purchaser to complete titling and in some cases registration of the vehicle. Such services were considered to be a separately bargained for service that took place after the transfer of possession of the vehicle to the customer. However, the general assembly added IC 9-14.13-3, effective July 1, 2016, which established a separate “convenience fee” that allowed dealers to charge for performing the services that have historically been excluded from the retail unitary transaction and represented by the documentation fee. As such, fees that meet the definition of a separately stated “convenience fee” are not subject to sales tax. While dealers may still charge a separate documentation fee in addition to the convenience fee, the services attributable to documentation fees will be considered to be charges by the seller for services necessary to complete the sale per IC 6-2.5-1-5(a)(3) and will be subject to sales tax.
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MARKET PERSPECTIVE | By Doug Hadden
FINDING GOOD CHEAP CARS
PART
3:
NEW
TECHNOLOGY
In the first installment of this three-part series, we looked at how to take advantage of upstream online auctions. Upstream is just a fancy way of saying “before the vehicle is shipped to physical auction.” We focused on OLOCs (One-Owner, Low-Mileage, Off-lease Cars) and learned how to acquire affordable cars your customers want, without having to go to a physical auction. In the second installment, we looked at buying real-time in multiple lanes, at multiple auctions, right from your desktop, laptop or phone! Since these articles, I have received a lot of great feedback and even trained some folks on how to buy cars live online – including easily accessible options like ADESA’s simulcast platform that allows dealers to bid virtually, in real time, on cars in the lane. One dealer said, “I may never go to a physical auction again.” Another dealer I worked with loves going to the physical auction. After training, he was standing in the auction lane bidding on cars as they drove through while also on his phone – bidding on cars at the same auction, at the same time, but in different lanes, and even checking proxy bids on cars at other auctions. Technology is opening new doors of opportunity for dealers, giving them a competitive edge like no other. This month we will look at new technology that is changing the way we buy and sell wholesale vehicles. When I owned my pre-owned lot many, many years ago, besides attending two local auctions every week, I spent every Monday morning stopping at Starbucks buying coffee and pastries I would take to my favorite used car manager who ran a large new car franchise. I usually arrived at the store as soon as the service department opened the front gates so I could look at and book out all the weekend trades before the UCM arrived. I would list what I wanted to pay for each car and what it needed for reconditioning on my yellow pad, head to his office and wait. We would grind out prices and two or three hours later I would call some drivers and get my new inventory to reconditioning. Not only did I have to get up at the crack of dawn, pay too much for a couple of rundown cars to get the ones I wanted (the old “package deal”), but I also burnt half a day away from my lot. Needless to say, this wasn’t a very efficient use of my time or inventory dollars. Fast forward to last week. I’m sitting at lunch with a friend who owns a small preowned lot, talking about how hard it is to find good cheap cars. His phone gives off
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a chirp. He quickly taps his phone, scrolls through a couple of screens, pounds out some numbers on his phone calculator, taps his phone one more time and gets back to our conversation. What was he doing? He was bidding on a car that was traded in at a new car franchise less than two hours ago. That’s right, sitting at lunch bidding on fresh trades and in the time it took to eat his burger, he owned the car! There are a few companies in this stillgrowing, dealerto-dealer digital auction space. I’m most familiar with ADESA’s sister company TradeRev, a mobile app that sends notifications to your phone as new car franchise dealers launch cars to a 45-minute on-demand, digital auction. You can view multiple photos, watch videos and even listen to the engine run. Settings allow you to customize your experience, enabling you to create alerts for only the types of cars you want – so you spend less time looking and more time buying. Think about the efficiencies this technology brings to the industry. With built-in artificial intelligence and machine learning, you can find the right car at the right price, in a transparent and fair process, all in about an hour. You can have funding, titling and transport pre-arranged in the app so when you win a car it quickly appears on your lot. And what about the seller? We know the longer you keep a car in stock the less gross you get – the dreaded “lot rot” is real. Even when you hit a home run on an aged unit, if you do the math on a profit-per-day basis, the ROI is weak at best. What would wholesaling a trade the same day it’s brought into inventory do for the average inventory turn time? It’s a win-win for both buyer and seller! The industry is changing, but so is the technology we use to run our operations. If you have not embraced buying cars upstream, live online from your PC, laptop or phone, or the newest app-driven one-hour, on-demand auction, you may want to rethink your business plan.
I’m not saying you can’t continue doing what you’re doing now and be profitable. I’m saying there is technology out there that can and will help you be more efficient – which leads to higher profits with less effort. Mastering these new, high-tech systems and apps is so easy there is no reason not to give them a try. I’ll even help you get started. Email me at Doug.Hadden@ADESA.com and I will set up some time for training you on one or all of the new technologies discussed in these articles. Once you get comfortable using the new tech, not only will you be more efficient and profitable, you may also have time left over to do other things you haven’t been able to do, like spending more time with family and friends! Until next time – have fun and sell cars! Doug Hadden is executive director of dealer consulting services for ADESA Auctions Inc. He can be reached at Doug. Hadden@adesa.com.
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MEMBER APPLICATION
The IIADA Has the Independent Auto Dealer Covered! Phone: (219) 661-0287 • Fax: (219)663-5294 iiada@comcast.net
JOIN TODAY
This is our personal invitation to you to join the State and National Independent Automobile Dealers Professional Associations It is important to me to be recognized as a professional! Enclosed are my annual dues of $295 to make sure that my business has all the advantages IIADA/NIADA Inc., provides to put me at the forefront of my profession. By completing this form, I agree to abide by the Code of Ethics. Also, I am consenting to and giving IIADA/NIADA Inc., its affiliates and subsidiaries, my permission to (until I give written notice to discontinue) contact me and provide information to me at the mailing and email addresses, telephone and fax number(s) I have provided.
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Dealership Name _______________________________________ Dealer Lic#_________________ Mail Address ______________________________________________________________________ County __________________________________________________________________________ City/State/Zip_____________________________________________________________________
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Signature: ______________________________________________________________________ Please include your email address, phone and fax numbers so that we can easily communicate with you. Membership dues are $295 for 12 months from the date you join, and your National lADA dues are included. Please send application and check or credit card information to: IIADA, PO Box 1393, Crown Point, IN 46308
Note: 25% of dues are non-deductible
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MEMBER BENEFITS
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• Certified Master Dealer Program • Free Access to NIADA.tv Training at Your Business • Access to IndependentDealer.com where dealers go for answers • NIADA Membership and Window Decal • IIADA “Symbol of Integrity” Logo and Window Decal • NIADA Annual Convention and Expo • Code of Ethics
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ASSOCIATE MEMBERS
IIADA Associate Membership is available to automotive related businesses. Please call 219-661-0287 for more information on Associate Memberships.
700 Credit
Ann Carson 202.422.2351 acarson@700credit.com www.700credit.com
ACV Auctions
Dennis Carey 260.350.2617 dcarey@acvauctions.com
Advantage One Tire Network Brandon Schlarb 317.809.6781 bschlarb@a1tnindy.com
AFC
Stephanie Freeman 317.343.5020 Stephanie.freeman autofinance.com
AFS Dealers
Bill Elizondo 972.322.0730 bill@afsdealers.com
Alpha Omega Group Brad LeBlanc 513.317.9861 brad@aogllc.com
ASC Warranty Co. Inc. Susan Williams/ Clayton Morgan 800-442-7116
Ashton Agency Inc.
Dealer Insurance, Bonds Kathy Alexander 407.678.5900 kalexander@ashtonagency.com
AutoZone
Gerry Sutter gerald.sutter@autozone.com 440.263.3389
Coastal Credit LLC
Austin McFarland 317.727.2778 amcfarland@coastalcreditllc.com
Consolidated Automotive Services
Chris Walsh 812.988.8300 www.consolidated autoservices.com
BirdEye, Inc.
David Tulkin 650.313.5225 David.tulkin@birdeye.com
Deluxe Corporation
Safeguard Printing Jennifer Blair 800.875.9908 jblair@safeguardprinting.com
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Donn H. Wray
Legal Counsel Stoll Keenon Ogden 201 N. Illinois Street, Ste. 1225 Indianapolis, IN 46204 317.608.4369
Drive1 USA, Inc.
Bruce Norton 1512 W. 96th Ave., Ste. C Crown Point, IN 46307 Phone: 219.670.0542 Email: Bnorton@drive1usa.com
Driven Brands
Clark Ellis 312.515.5664 clark.ellis@drivenbrands.com
Encompass Dealer Services Terry Schwer 765.969.1692 terry@encompassdealers.com
Envirotest Titling & Registration Kevin Lewis 1445 Brookville Way Suite G Indianapolis, IN 46239 317.322.0020 www.etrindiana.com
Envirotest Titling & Registration Kevin Lewis 1111 S. Green River Rd. Suite 100 Evansville, IN 47715 812.909.0116 www.etrindiana.com
Envirotest Titling & Registration Jennifer Kharchaf 1171 Breuckman Dr., Ste. B Crown Point, IN 46307 219.661.8220 www.etrindiana.com
Frazer Computing Inc.
HBK CPAs & Consultant Rex Collins 330.758.8613 rcollins@hbkcpa.com
Insurance ProfessionalsDealer Specialists Steffy Hatoway Jan Hatoway Office: 317.861.4411 Cell: 317.750.3032
Insurance Professionals of New Palestine
Network Benefits of Mid America 35 W. Main St. P.O. Box 467 New Palestine, IN 46163 Office: 317-861-4411 800-688-7988 Cell: 317-750-3032
Integrity Warranty, LLC
Paul Mulready 423.355.8353 pmulready@integritywarranty.com www.integritywarranty.com
Lincolnway Insurance Services Greg St. Germain 336 E. Lincoln Hwy. Schererville, IN 46375 219-865-2227 gregg@lincolnwayinsurance.com
Maxey & Associates Insurance
P O Box 7900 Wilkes-Barre, PA 18773 317.374.6271 www.gwcwarranty.com
Reliable Auto Finance
Lester Dean PO Box 9700 Wyoming, Michigan 49509 616.438.3591 Fax: 616-245-5978 lesterd@reliableautofinance.com
Somerset CPAs
Jane Saxon, CPA 3925 River Crossing Pkwy. Indianapolis, IN 46240 317.472.2183 jsaxon@somersetcpas.com
SPIREON
Dave Boekholder 800.557.1449 dboekholder@spireon.com
T & J Dealer Services
Frank Hackett 301.696.0400 naaa@naaa.com
NextGear Capital
GWC Warranty
Mark Cohen 2505 Producers Lane Indianapolis, IN 46218 Phone: 678.327.5584
National Auto Auction Association
Freedom Warranty
Tom Lloyd 513.515.5442 tlloyd@guardianfinancecompany.com
Pull A Part of Indianapolis LLC
Strategic Consulting
Nationwide Cassel LLC
Guardian Finance Company
Matt Reece Phone: 864.237.6090 Matt.Reece@pfs-corp.net Nat Rieder Nat.Rieder@pfs-corp.net Phone: 614.935.9808
Health Insurance Specialists Pam Mix 219.763.2401 maxey.insurance@comcast.net
6196 US Hwy 11, P O Box 569 Canton, NY 13617 888.963.5369 www.frazer.com John Skelton 423.207.1333 www.freedomwarranty.com
Professional Financial Services
Mark Plunkett mplunkitt@nationwideloans.com 317.441.1637 Lori Kahre 1320 City Center Drive Suite 100 Carmel, IN 46033 Phone: 317.571.3845 www.nextgearcapital.com
NVP Warranty
Art Mastyugin 888.270.5835 art@nvpwarranty.com
Preferred Warranties, Inc.
Gregg Reidenbach/Guy Loeffler 800-548-1121 info@warrantys.com www.warrantys.com
Jeff Bond 317.363.6458 jeff@scspro.net
Justin Stuckey 260.403.2410 justin@dealerservices.com
Teipen, Selanders, Poynter & Ayres, P.C.
Certified Public Accountants Barnett Sapurstein, CPA 317.598.6700 bsapurstein@teipencpa.com
Turner Acceptance
Jonathon Turner Phone: 773.290.5007 turneracceptance.com